Despite a recent spate of scandals, J.P. Morgan and Goldman Sachs continue to hold the admiration of most people. But when it comes to earning respect and veneration from those within the industry, the two New York banks aren’t the gold standard. That honor surprisingly goes to a west-coast commercial bank: Wells Fargo.
In a recent Fortune ranking of the world’s most admired companies, J.P. Morgan and Goldman Sachs finished 30th and 33rd respectively, making them the top ranked “mega-banks” on the list. Wells Fargo ranked 35th.
It’s important to note, however, that Fortune’s list was based off responses from directors, analysts and executives across a host of industries. When taking into account only the responses of those working within banking, Wells Fargo earned the highest praise, knocking last year’s champ, J.P. Morgan, from the top spot. Goldman finished third. The banking industry list took into account variables like quality of management, wise use of corporate assets, long-term investment value and the ability to attract and retain talented people.
Why Wells Fargo is better regarded outside of the industry is up for debate, but there are certainly a few reasons to choose from. The bank booked double digit gains in trading, insurance and wealth management last year while also growing market share in investment banking. Wells Fargo had stronger earnings than J.P. Morgan in 2013 despite holding a fraction of the assets.
You can also argue why Wells Fargo would lose out to the other two banks when it comes to their general reputation, although the overall rankings were admittedly narrow. It’s a commercial bank, for one, something Goldman Sachs isn’t. Transactional banking provides more opportunities to lose appeal. It also doesn’t appear to be making the same public relations push of Goldman and J.P. Morgan. The two New York banks have made major investments in that regard post-crisis.
The survey’s release was certainly well-timed. Just last week, J.P. Morgan CEO Jamie Dimon lauded the San Francisco-bank as a key rival firmly on their radar.
Along with Goldman Sachs, Wells Fargo represents “huge, tough competition,” Dimon said. “Wells Fargo will be in our business. I have enormous respect for them.” It appears he’s not the only one.